Updated September 22, 2017 12:08:54

Photo: The transition of CommInsure life products is expected to take three to four months. (ABC News: Margaret Burin)

The scandal-plagued CommInsure brand could disappear over time as its new owner introduces new products, AIA Group regional chief executive Bill Lisle has conceded.

Speaking after the Commonwealth Bank announced the $3.8 billion sale of its troubled life insurance arm to the Hong Kong listed company, Mr Lisle confirmed fallout from the CommInsure scandal was an issue as the deal was hammered out.

"That was obviously a key part of the consideration," Mr Lisle said.

"But that was top of mind in the market for our board and our shareholders and we feel that CBA are taking the right course of action.

"We understood the reputational challenges.

"As you can imagine we did a lot of due diligence, we had independent third parties to investigate so we understood some of the challenges.

"But I think things will move along as they inevitably do."

Asked by the ABC if the CommInsure brand passed the "sniff test" for shareholders Mr Lisle said "absolutely — otherwise we would not have done the deal".

While the Commonwealth Bank said the CommInsure brand would be retained under a 20 year agreement for existing life products, Mr Lisle would not guarantee AIA's long-term commitment to the CommInsure name.

"We'll look at that as we move forward. I think it could depend on specific products," he said.

"But you would imagine over a five to 10 year period, just through normal product evolution, that products will change."

Mr Lisle responded cautiously when asked if AIA could be described as a "white knight" by assisting the CBA in offloaded the CommInsure life business.

"I'll leave it to you to comment on that. I couldn't. But what I will say is that we're very happy with the deal," Mr Lisle said.

The transition of CommInsure life products is expected to take three to four months. CommInsure will continue to offer general insurance products.

However, AIA's purchase of CommInsure Life will be subject to approval from the Foreign Investment Review Board.

Follow Peter Ryan on Twitter @peter_f_ryan and on his Main Street blog.

Topics: banking, insurance, australia

First posted September 22, 2017 11:43:27